Privately owned property group Grosvenor and UK REIT Derwent London are forming a partnership to consider the redevelopment of 1-5 Grosvenor Place, London SW1. The site of over 1.5 acres, next to Hyde Park Corner, offers the opportunity to undertake a substantial mixed-use redevelopment, likely to include a luxury hotel, commercial and residential uses.

The existing building is held under long leases by Derwent, with the freehold held by Grosvenor. It comprises mainly offices and extends to 168,000 sq ft (15,600 m2) with the potential to be increased significantly. Subject to planning consent the redevelopment could commence in 2014.

'We are delighted to work with Derwent London to unlock the potential transformation of this important site which acts as a gateway to Belgravia,' said Giles Clarke, Grosvenor Britain & Ireland's executive director. 'The project is a perfect fit for our expertise in mixed-use, and prime central London development, and adds to our growing pipeline in the capital.'

Derwent London will continue its active asset management role at the site with Grosvenor acting as development manager.

Separately, Derwent London said it has been granted planning permission for a major new 289,000 sq ft redevelopment at City Road Estate, London EC1. The proposals, by architects Allford Hall Monaghan Morris, include 271,000 sq ft of offices, 10,000 sq ft of retail and 8,000 sq ft of private residential accommodation.

The group said it is currently reviewing its strategy for the development, and it is likely that a marketing campaign will be undertaken to secure a significant pre-let prior to commencing construction. Capital expenditure for the new scheme is anticipated to be in the region of £105 mln.